Sunday, February 18, 2007

Corporate history is rife with examples of how internal "skunkworks" have failed miserably in creating innovations that have translated into huge profits for the corporate "mothership" later on. The best example is likely Xerox PARC.

Robert Burgelman of Stanford has studied and written eloquently and convincingly about how to avoid the trap of bureaucracy causing this (at GE and others).

Brad Horowitz (pictured above) and Caterina Fake of Yahoo! have decided to step into the potential innovation minefield with the recent launch of "Brickhouse" whose purpose is to create great new ideas that hopefully turn into winning services for Y! They've wisely chosen a physically separate locale from the Sunnyvale corporate complex in gritty downtown San Francisco and eschew all reminders of the purple-and-gold brand from which they came and to which the fruits of their labors will return to. They aim to let a 1000 web services bloom and see what sticks to the wall.

What's new about "Brickhouse" compared to Xerox PARC and other corporate innovation initiatives is how quickly and cheaply they can test new services with their audiences. It would be like NBC Universal throwing up 1000 pilots for review/comments and seeing which are future "Lost"s and which are future stinkers (that's not a bad idea and I'm sure we're not far away from that). Corporate bureaucracy and so-called internal experts won't get a vote; users will. And, it won't be a simple "yes/no" but -- more likely -- a dialogue helping further improve the "Pipes" of the world.

Horowitz and Fake deserve credit for being among the first within many relevant corporations to recognize this and capitalize on some trends coming together to easily allow for this testing. Let's now see what they come up with and which other companies are next to follow.

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